Mesquite Asset Permian Basin Investor Meeting, London – June 2019 W W W . N T O G . C O . U K
Opportunity Current market cap - ◊ Circa £5m Foundation -Existing producing assets (bankable reserves as at 1 Jan 2019) ◊ 764,030 bo Net Proved reserves ◊ Total Proved US $14.96 million future net income ◊ Total Proved NPV9 estimated at US$7.54 million Future - Mesquite (per Engineered Economics 21 Jan 2019) ◊ Over 2.5 MMBO recoverable reserves ◊ ~$28 million NPV10 ◊ Drilling planned H1-19 Mesquite Asset Permian Basin 2
Who is Nostra Terra Nostra Terra Oil and Gas is focused on achieving profjtable, rapid and sustainable growth within established ◊ Nov ‘16 - First Permian Acquisition & Secured 80% Pine Mills hydrocarbon provinces, such as the USA and Egypt. Our goal is to generate returns for our shareholders by ◊ Feb ‘17 - Second Permian Acquisition acquiring and managing a growing portfolio of both new and mature oil and gas assets, to which we can ◊ Sept ‘17 - Secured 100% Pine Mills add signifjcant value through modern technology and commercial expertise. ◊ Sept ‘17 - Secured BP Hedging Facility ◊ Oct ‘17 - 3rd Permian Acquisition (“Twin Well”) ◊ Nov ‘17 - Commenced Twin Well drill ◊ Jan ‘18 - Washington Federal $5m SFL @ 4.75% ◊ Foundation of producing assets & long-term ◊ Feb ‘18 - Twin Well completed & producing cash fmow ◊ Mesquite - new asset delivering a large ◊ May ‘18 - Permian G6 Well drilled & producing multiple over existing reserves. ◊ Over 2.5MMBO recoverable reserves 1 ◊ Aug ‘18 - Record H1 Revenue ◊ $28 million NPV10 1 ◊ Drilling planned H1-19 ◊ Oct ‘18 - Mesquite Acquisition Mesquite Asset Permian Basin ◊ Jan ‘19 - Additional Mesquite acreage & Field Development All references to oil prices are WTI Plan complete 1 Per Engineered Economics 21 Jan 2019 3
People Matt Lofgran Ewen Ainsworth CHIEF EXECUTIVE OFFICER NON-EXECUTIVE CHAIRMAN Matt Lofgran has wide experience of business development in the Ewen Ainsworth is a chartered management account and a fellow of the Institute of Petroleum. He has 30 years experience in the industry at various stages of the oil and gas energy, real estate and communications sectors. Prior to becoming life cycle from exploration to appraisal/development, production and de-commissioning. CEO of Nostra Terra, he was with Robson Energy, LLC, latterly as Vice Beginning his career in the late 1980’s at Conoco, Ewen has taken on Financial Controller, President of International Business Development. In this capacity, Financial Director and CFO roles across various public and private companies, including he launched the oil and gas, fjeld services and coal divisions, six years as Financial Director of Gulf Keystone Petroleum Limited, where he worked until and was responsible for extending Robson Energy’s activities into 2014. He is currently CFO of San Leon Energy Plc, listed on the London Stock Exchange. During his career, Ewen has been involved in companies with assets and operations Mexico. Matt holds a Bachelor of Business Management degree across the UK, Europe, Russia, Azerbaijan, Iraq and North and West Africa. from the University of Phoenix and a Global MBA from Thunderbird School of Global Management. He is also a Director of Elephant Oil Limited. John Stafford NON-EXECUTIVE DIRECTOR John Stafford has 35 years experience in the oil & gas industry and is a geoscientist, with specialist expertise in oil fjeld development and reserve certifjcation and reporting. Previous roles include Vice President of Operations at Gulf Keystone Petroleum Limited, a Mesquite Asset Permian Basin position he held from May 2014 to January 2017, having joined that company as Manager, Geology & Geophysics in early 2009. John has worked with well known companies in the oil and gas industry, such as ECL, Schlumberger and PGS, managing projects in integrated fjeld management and all aspects of reserves certifjcation and reporting. This includes the production of Competent Persons Reports. John has further experience of fractured reservoir development and risk management. 4
Nostra Terra - US Assets Mesquite - Established as an operator with full control of portfolio, focused on low- ◊ Low risk, high impact opportunity in the Permian Basin risk exploration and development ◊ 2.5MMBO recoverable reserves drilling of the MId-Contintental USA ◊ $28 million NPV10 ◊ Drilling planned for H1-19 ◊ Unsolicited interest from multiple parties for farm-in (process to begin following completion of fjeld development plan) Existing US Assets ◊ 646MBO Net Reserves (1P)1 ◊ 109 bopd net (194 bopd gross) 2 ◊ Profjtable production during 2017 full year and 2018 fjrst half, impacted by Nostra Terra taking over operations at Pine Mills. ◊ Foundation that supports WAFD Sr. Lending and BP Hedging facilities ◊ 1,500 barrels per month hedged at $60 to 31 December 2019 Pine Mills - ◊ Production peaked at approximately 150 bopd following successful reactivations and work overs. ◊ Fireldwork being completed to handle increased fmow. Permian Basin - Mesquite Asset Permian Basin ◊ Successfuly drilled two vertical wells on new acquisition in last year 1 Year End 2017 2 November 2018 5
Permian Basin One of the most prolifjc oil and natural gas producing regions in the world. 8/30/2018 BP Pays $10.5B For A Second Chance At The U.S. Shale Game 2,976 views | Jul 27, 2018, 01:52am BP Pays $10.5B For A Second Chance At The U.S. Shale Game Christopher Helman Forbes Staff Energy "A transformational acquisition," is what BP CEO Bob Dudley calls it. Two years ago he said he'd rather invest in Argentina's shale than in the Permian Basin. Situations change. (Photographer: Chris J. Mesquite Asset Ratcliffe/Bloomberg) Permian Basin With its $10.5 billion acquisition of oil and gas fields from BHP Billiton, BP is buying itself a second chance at the great American shale game. The British supermajor largely missed the early days of the American oil revolution. Reeling from the 2010 Deepwater Horizon disaster and desperate to 6 https://www.forbes.com/sites/christopherhelman/2018/07/27/bp-pays-10-5-billion-for-a-second-chance-at-the-u-s-shale-game/#78f1231d12d7 1/4
Permian Basin NM TX Permian Basin Province boundary 30 60 Miles Greater London Mesquite Asset Permian Basin 7
Horizontal Wells Improved recovery from horizontal wells 5,000 FT Mesquite Asset Permian Basin Horizontal Well Bore Vertical Well Bore +/- 5,000ft of Oil Payzone +/- 60ft of Oil Payzone 8
Mesquite - Low Risk, High Impact in the Permian Basin Mesquite is in the prolifjc Permian Basin where the surrounding area is proven to produce from multiple, stacked-pay reservoirs. The area has long-established producing wells that were drilled vertically on 40 acre spacing. In recent years operators have successfully drilled wells with tighter 20 acre spacing. On this basis, the Mesquite Prospect has the potential to host a minimum 35 potential vertical well locations, by drilling at 40 acre spacing, however, Nostra Terra believes the Mesquite Prospect has much greater development potential if drilled horizontally. ◊ Prolifjc oil fjeld ◊ Proven and developed with vertical wells ◊ Subsurface control ◊ Approximately 1,200,000 barrels of oil recoverable per square mile (640 acres) Mesquite Asset Permian Basin ◊ 1,384 net acres currently leased, with scope to expand ◊ Extent of play estmiated to be approximately 30,000 acres 9
Economics 100% Lateral Length 5,000’ 80% Average EUR 300 MBoe Before Tax IRR 60% % Oil 100% 40% Initial 30-Day Production Average 265 Bopd 20% Potential Locations with 100% Working Interest on Existing 4 Leasehold 0% $45 Current $60 $75 PV10 Per Location at $60 oil $3.3 million Strip Oil Price ($ / Bbl) Total PV10 for All Four Locations at $60 oil $13.2 million EUR 10% Below Estimate Estimated EUR at 300 MBbl EUR 10% Above Estimate Remaining Acreage Outside of 100% Working Interest 744 net acres Locations Pro Forma Value Per Acre at $60 oil $20,669 per acre 1 Potential Value of Remaining 744 Net Acres $15.4 million Mesquite Asset Permian Basin Potential Combined Value of 1,384 Net Acres $28.6 million 1 Pro forma values assume remaining 744 net acres achieve the same economic value as acreage where 100% working interest wells are drilled. Per acre value calculated as $3.3 million divided by 160 acres. 10
Key Well Assumptions Cumulative Production 300,000 ◊ ~300,000 Bbl EUR was based on calculated volumetric using 160 acre spacing with a 10% recovery factor 250,000 ◊ Well operating expenses are based off of current operating expenses in the area and are subject to 200,000 change Cumulative Barrels of Oil ◊ Based on the volumes shown by the decline it is expected to lift the well with ESP for the fjrst 18 months 150,000 and then convert to rod pump; operating expenses consequently drop after month 18 100,000 ◊ Economics assume 100% working interest and 75% net revenue interest 50,000 ◊ Per Nostra Terra, the economic runs assume there is disposal available to the well at a cost of $0.25/Bbl ◊ Oil differential based on WTI / Midland prices 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Year Mesquite Asset Permian Basin 11
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